UAE Central Bank develops credit data sharing laws.
The head of the UAE's first credit bureau has urged banks to abandon the practice of using security cheques to jail debtors, as the Central Bank works on new laws to regulate credit information sharing.
Bashar Qallab, CEO, Emcredit, said: "Putting people in jail is not mitigating your risk. It costs the government a fortune to chase down cheques and it's expensive for banks as well."
He urged banks to improve their use of credit data to cut bad debts. A draft law is currently being finalised at the UAE's Ministry of Justice which could establish a federal credit bureau and a national credit data-sharing structure.
Emcredit is part of the technical advisory committee and is consulting on the forthcoming credit information law. It is currently headquartered in Dubai International Financial Centre (DIFC) and operates under the regulation of Dubai Financial Services Authority, which has its own data protection law and data protection commissioner.
It ensures the protection of all personal information, including any sensitive personal data, and is compliant with the provisions of the laws and directives of the European Union and the guidelines of the Organisation for Economic Cooperation and Development.
If a new law related to credit bureau information were to come into existence in the UAE, it is likely that Emcredit would need to establish an operation in the country but outside the DIFC.
"It doesn't negate the need for a DIFC office, which would be necessary for cross-border sharing of information," said Qallab. "We would need an onshore entity to meet our obligations. We are confident that under the proposed federal legislation, Emcredit will continue to offer world class products and services."